Soros: There's a Mystery Buyer of Euros Out There

Someone is buying large amounts of euros anonymously, probably the Chinese who want an alternative to the dollar, says financier George Soros, a famous currency speculator who bet against the pound and made a fortune during the 1992 U.K. currency crisis.

Europe remains embroiled in turmoil, with fears growing that a debt crisis in Greece could spread to larger countries such as Spain and eventually spark a run on all European banks.

The euro, however, is up 7.6 percent against the dollar so far this year, according to The Wall Street Journal.

George Soros
(Getty Images photo)

"I certainly would not short the euro because China has an interest in having an alternative to the dollar. You can count on China to back the efforts of the European authorities to maintain the euro," Soros tells Der Spiegel magazine.

The United States, meanwhile, has avoided dipping back into recession but that's going to be harder to do going forward.

"If a double-dip recession was in doubt a few weeks ago, it is less in doubt now, because financial markets have a very safe way of predicting the future. They cause it. And the markets have decided that America is going to see a recession, particularly after the recent downgrade of the U.S. by the rating agency Standard & Poor's," Soros says.

China, meanwhile, has compared the European debt crisis to the Black Death, the plague that decimated the population in the 14th century, arguing the crisis could hurt Chinese exports to Europe.

"The euro debt crisis has now been going for nearly two years since the end of 2009, and the sovereign debt crisis has spread like the Black Death of the fourteenth century across the euro zone countries," says People's Daily, the top newspaper of China's ruling Communist Party, according to Reuters.

Someone is buying large amounts of euros anonymously, probably the Chinese who want an alternative to the dollar, says financier George Soros, a famous currency speculator who bet against the pound and made a fortune during the 1992 U.K. currency crisis.
Europe remains...